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Wednesday, October 13, 2010

China 2010-11 Unmilled Rice Consumption Up 2.2% On Year

China's consumption of unmilled rice in the crop year that began Oct. 1 will rise 2.2% to 188.7 million metric tons compared with an estimate of actual consumption last year, Zhang Haoran, a senior analyst at the China National Grain and Oil Information Center, said.

"Consumption is rising at a higher rate than production. Therefore, the annual surplus this year is expected to be lower, at 7.2 million tons, than the 9.9 million tons last year," Zhang said at an international rice conference.

Production is forecast at 196.4 million tons, up from 195.1 million tons last year, he said, adding that exports and imports are expected to be unchanged this year, at 1 million tons and 500,000 tons, respectively.

China's total per capita annual grain consumption is forecast at 395 kilograms for calendar year 2020, up from 389 kilograms in 2010, Zhang said.

Zhang said China's population is growing by around 6.5 million people each year and this is pushing up total rice consumption.

Shrinking farmland is a great challenge, and the only way to boost output is to raise yield, which has been increasing by an average 0.4% annually for the past few years, he said.

Zhang said China's area under rice has shrunk to around 29.9 million hectares from 33 million hectares in the last two decades, but yield has increased to 6.5 tons/hectare from 5.72 tons/hectare.

However, he said China's unmilled rice production, which rose to an all-time high of 206.2 million tons in 1997, hasn't been able to reach that level ever since. Production fell six years in a row and drought dragged it down to 161 million tons in 2003.

He said the area under rice did increase marginally by 250,000 hectares this year, but early plantings of the crop were damaged by heavy rains and floods in July.

The early-planted rice output is forecast to decline by 2.04 million tons to 31.32 million tons in 2010-11. However, this will be offset by a 2% and 2.4% increase in production of intermediate and late-sown varieties. Early planted rice has a 20% share in overall output compared with 59% for intermediate rice and 21% for late-planted rice.

He said there hasn't been any significant substitution of rice consumption with flour, even though rice prices are higher than wheat. He said consumption of premium Japonica rice has been on the rise, but this isn't a cause of concern because the country has the potential to achieve self-sufficiency in production of this premium grade.

Zhang said China continues to be a net exporter of rice. He said imports during the January-August period are estimated at 209,200 tons, including 37,000 tons from Vietnam and 167,000 tons from Thailand.